U.S. stocks fell Wednesday, led by a drop in the Nasdaq with technology shares declining as investors moved into more defensive areas, while bank stocks extended recent losses following some mixed quarterly results.

The S&P 500 bank index dropped, with shares of Wells Fargo down sharply after the ‍company missed fourth-quarter profit expectations.

Citigroup and Bank of America shares also fell, even after the ‍companies beat Wall Street estimates for fourth-quarter profit.

Financials, including the banks, which were up sharply in 2025, have fallen this week amid concerns over U.S. President Donald Trump's proposed ⁠cap on credit-card interest rates, which JPMorgan executives warned could squeeze consumers and hurt financial sector profits.

"After a nice run, and so-so or mediocre earnings, you're seeing profit-taking and consolidation" in the banks, ​said Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. "Generally speaking, people are still optimistic on the group."

In tech, he said, investors are looking to rotate out of expensive megacaps and into value and more defensive names. In addition, the president has ‍gone after a number of industries, "putting Main Street over Wall Street."

S&P 500 financials fell along with the ⁠S&P 500 technology sector while more defensive groups including consumer staples rose. The small-cap Russell 2000 index, which has been outperforming the benchmark S&P 500 so far this year, also rose.

According to preliminary data, the S&P 500 lost 36.71 points, or 0.53%, to end at 6,927.03 points, while the Nasdaq Composite lost 228.69 points, or 0.96%, to 23,481.19. The Dow ⁠Jones Industrial Average fell 33.37 points, or 0.07%, ​to 49,158.62.

Shares of Broadcom, Palo ⁠Alto Networks and Fortinet declined after a Reuters report said Chinese authorities have told domestic companies to stop using cybersecurity software made by roughly a ‍dozen U.S. and Israeli firms.

On the flip side, energy shares rose as oil prices gained early amid worries about Iranian supply disruptions due to ‌a potential U.S. attack on Iran. Oil eased late in the day after Trump said he had been told that killings in Iran’s crackdown on nationwide protests were subsiding.

Data earlier on Wednesday showed producer prices in ⁠the U.S. matched forecasts ​in November, but retail sales ‍topped expectations. A report on Tuesday showed December consumer prices rose as projected.

Interest rates are widely expected to hold steady through the first half of the year, including at the ‍Fed's January meeting, with traders pricing in at least two cuts before year-end, according to LSEG data.